v3.26.1
Debt
 3 Months Ended
Mar. 31, 2026
Debt Disclosure [Abstract]  
Debt
6. Debt
Long-term debt consisted of the following (in thousands):
March 31, 2026December 31, 2025
Senior secured loans (includes unamortized discount and debt costs of $6,006 and $6,094 based on an imputed interest rate of 10.4% and 10.4%, at March 31, 2026 and December 31, 2025, respectively)
$227,672 $232,406 
Less current maturities(4,127)(7,739)
Total long-term debt$223,545 $224,667 
On July 25, 2025, the Company entered into a Credit Agreement (the “Credit Agreement”) which provided for (i) a senior secured term loan facility in the aggregate principal amount of $240.0 million (the “Term Loan”) and (ii) a senior secured revolving credit facility in the aggregate principal amount of $30.0 million (the “Revolving Facility” and together with the Term Loan, the “Credit Facilities”).
The Term Loan matures on July 25, 2031 and bears an interest rate of the secured overnight financing rate, which shall not be less than 1.5%, plus a margin of 6.0% per annum (with step downs and a potential step up at specified leverage levels). At March 31, 2026, the floating interest rate was 9.7%.
Payments on the Term Loan are due quarterly in amounts equal to (a) 2.50% per annum of the original principal amount of the Term Loan commencing beginning December 31, 2025 through September 30, 2026, (b) 1.75% per annum of the original principal amount of the Term Loan commencing December 31, 2026 through September 30, 2027, and (c) 1.00% per annum of the original principal amount of the Term Loan commencing December 31, 2027 and continuing each fiscal quarter thereafter, with the balance payable on the maturity date. Excess Cash Flow payments due under the terms of the Credit Agreement were $0.2 million and $3.3 million at March 31, 2026 and December 31, 2025, respectively, and are included in current maturities of long-term debt in the condensed consolidated balance sheets.
The Revolving Facility matures on July 25, 2031 and bears the same interest rate as the Term Loan. No amounts were outstanding under the Revolving Facility as of March 31, 2026.
The Credit Facilities contains customary representations, warranties, covenants, including financial covenant, and events of default. The Credit Facilities are secured by substantially all of the Company’s assets, subject to certain exclusions. The Term Loan also includes (i) a covenant tested quarterly which limits the consolidated secured leverage ratio to 6.0 to 1.0 or under and (ii) certain other changes to the terms of the Credit Agreement, including with respect to certain negative covenants. The Revolving Facility is subject to the same covenants and terms as the Term Loan. As of March 31, 2026, the Company was in compliance with all covenants under the Credit Facilities.
The Company’s previous senior secured credit agreement provided for 7 year, senior secured term loans which were repaid July 25, 2025 with the proceeds of the Term Loan.
Lender fees and third party costs associated with the Term Loan are recorded as a direct deduction from the long-term debt and lender fees and third party costs associated with the Revolving Facility are recorded in other assets in the condensed consolidated balance sheets. All lender fees and third party costs are amortized into interest expense, net over the contractual term of the Credit Agreement.
Interest rate derivatives
In 2019 the Company entered into floating-to-fixed interest rate swap agreements to limit exposure to interest rate risk related to their debt through the maturity of the previous senior secured term loans, August 6, 2026. At the time the Company entered into the interest rate swap agreements, the Company designated all of the swaps as cash flow hedges. In August 2024, the Company de-designated all of the interest rate swaps and the realized and unrealized gains previously recognized as a component of accumulated other comprehensive loss are being amortized to interest expense, net as interest is accrued or prepayments are made on the Company’s debt. Subsequent to the de-designation, changes in the fair value of the interest rate swaps were recorded to interest expense, net. On July 18, 2025, the Company sold all of its remaining floating-to-fixed interest rate swap agreements.
Effective September 30, 2025, the Company entered into an interest rate cap agreement to limit exposure to interest rate risk, effectively capping the secured overnight financing rate at 4.5% related to $120.0 million of their outstanding debt. The interest rate cap is reported at fair value and is included in interest rate derivatives on the condensed consolidated balance sheets, and the change in the fair value of the interest rate cap is reported in interest expense, net on the condensed consolidated statements of operations.
The impact of the Company’s interest rate swaps on its condensed consolidated statements of comprehensive loss for the three months ended March 31, 2026 and March 31, 2025 was as follows (in thousands):
Three Months Ended March 31,
20262025
Amounts reclassified from accumulated other comprehensive loss to interest expense, net
$(1,137)$(3,890)
The impact of the Company’s interest rate derivatives on its condensed consolidated statements of operations for the three months ended March 31, 2026 and March 31, 2025 was as follows (in thousands):
Three Months Ended March 31,
20262025
Unrealized gain (loss) in fair value of interest rate derivatives
$90 $(2,164)
Amounts reclassified from accumulated other comprehensive loss to interest expense, net
1,137 3,890 
Cash payments on interest rate swaps
— 1,663 
Total income (expense) from interest rate derivatives in interest expense, net
$1,227 $3,389 
Cash interest costs averaged 9.7% and 5.9% for the three months ended March 31, 2026 and 2025, respectively.